The IPKat has known for a while that his friends at the Max Planck Institute for Innovation and Competition, together with a number of eminent patent scholars from elsewhere on the planet, have been working on a Patent Declaration on the interpretation of TRIPS for the past couple of years [says Merpel, this is why they have been wandering around with solemn countenances which send out an "I'm-up-to-something-really-important" message ...]. The Declaration hasn't quite been launched yet –- that happens tomorrow -- but in the meantime we have a taste of things to come, via former guest Kat Matthias Lamping (currently a Senior Research Fellow at the Max Planck Institute). Matthias has kindly given us sight of the press release that trumpets the publication of the Declaration. This is what it says:

20 Years WTO/TRIPS: Experts Show: Problems of the Patent System are
Home-Made

Patent law is
omnipresent in the business news of today. One record number of patents issued
follows the next. At the same time, the public consciousness is occupied by ‘patent
wars’ between Smartphone manufacturers, massive demonstrations against the
perceived greed of pharmaceutical companies or the patenting of tomatoes,
animals and even parts of the human body. At the time of its introduction, the
patent system was not without controversy either. However, is it now at the
brink of collapse? What are the problematic issues -– are they to be found in
international law? 40 patent law experts from 25 countries deliver answers. In
the ‘Declaration on Patent Protection’, published in connection with the 20th anniversary of the WTO, they demonstrate the manner in which the international
legal order leaves ample space for differing designs of national patent systems
and how this flexibility promotes economic growth and social welfare.

On April 15, 1994, the community of states entered
into an historic agreement of international law. With the establishment of the
World Trade Organization (WTO) they responded to the globalization which had
been rapidly progressing since the 80s. The WTO is based on three pillars, the
General Agreement on Tariffs and Trade (GATT), the General Agreement on Trade
in Services (GATS) and the Agreement on Trade-Related Aspects of Intellectual
Property Rights (TRIPS). By incorporating the major international treaties on
intellectual property at the time, the TRIPS Agreement became the benchmark for
national IP systems practically overnight ['practically overnight' is the way it might look if viewed through the binoculars of 2014, but it was a long, long process while it was actually happening, notes this Kat, who was alive at the time ...]. Today, the WTO has 159 member
states, including all industrial nations and upcoming economies such as China
and Russia, in addition to a number of developing and emerging countries.

In the two decades since, the perception of
intellectual property’s importance and function has changed substantially. It
did not take long for the Internet to reveal the darker sides of copyright law.
In contrast, the drawbacks of the patent system have only recently come to
light. Nowadays, the patent system makes headlines for the disputes it
generates instead of for the innovation it promotes. Smartphone manufacturers
like Apple, Microsoft and Samsung engage in litigation wars and try to drive
each other out of the market. Pharmaceutical companies are accused of blocking,
or at least delaying, the market entry of generics in order to maintain high
prices for their blockbuster drugs. So called ‘patent trolls’ have come into
the spotlight for buying up entire patent portfolios -- not to manufacture their
own products but to extract licensing profits by blackmailing alleged
infringers. Not all industries are equally affected by these phenomena, but
there is a general perception that patents are increasingly used for strategic
purposes rather than to protect innovation[it's regrettable that IP is consistently subjected to analysis in simple binary terms. For example, patents can beused both for strategic purposes and to protect innovation].

Disappointment awaits those who expect to find the
potential damage of such dysfunctional patent uses reflected in the debates
about international law. Most developed countries vehemently advocate
strengthening patent protection even more. However, these efforts are now met
with considerable resistance [curiously, little reference is made in these disputes to the presence and the efficacy (of lack of it) or otherwise of the antitrust and competition law provisions which may be used to neutralise abuses caused by over-strong IP protection]. Roughly two years ago, the Anti-Counterfeiting
Trade Agreement (ACTA) raised the level of public awareness in this regard. This
secretly negotiated agreement led to a global outcry and resulted in a wave of
public demonstrations across the globe.

The success of such resistance was remarkable. Several
legislators, including the European Parliament, have rejected ACTA. However,
this victory was rather limited in scope. The world’s attention has now been
turned to the Trans-Pacific Partnership (TPP), which is currently being
negotiated –- still secretly, but this time without the participation of the EU
–- between the Unites States and a number of other countries. In addition, there
are several other, often equally intransparent, bilateral negotiations going
on. Patent law is often a subject matter of these negotiations. In exchange for
trade concessions in other areas like textiles or agriculture, developing
countries are being persuaded to implement high standards of patent protection
which are often not in their interest. Such standards may even prove detrimental
to the long-term development of national innovation capacities and may
therefore ultimately only serve export interests of trading partners.

Intellectual property is not merely a third-world
problem. It is a global challenge. As important as the legal certainty
resulting from exclusive rights may be in maintaining investment incentives,
the very same rights can cause immense harm if protection becomes excessive and
thereby compromises effective competition or other public interests. Thus it
is vital to achieve the appropriate scope of legal protection. More protection
does not necessarily lead to more innovation. Patent law does not merely
function to serve the interests of inventors and right holders. It is a
regulatory institution.

It is often claimed that international law requires a
high level of patent protection and leaves little policy space for pursuing national
public interest goals. In a ‘Declaration on Patent Protection” a renowned group
of patent and international law experts prove this assertion to be inaccurate. In
particular, the experts declare that international law permits many measures
which are essential to a sustainable patent system. The hostility shown to the
TRIPS Agreement by many developing and emerging economies is often owed to a
failure to recognize the actual flexibility afforded by the Agreement with
regard to the design and application of national law [bravo, cheers this Kat, who has been saying this for years ...].

The Declaration on Patent Protection was drafted under
the auspices of the Max Planck Institute for Innovation and Competition in
Munich. It is the result of two decades of intensive research. In brief and clear
manner, the Declaration indicates the interpretive scope of TRIPS norms.
Overall, the Declaration remains neutral – it is neither directed at states
with a specific level of development nor does it aspire to provide
recommendations for legal action. It only points out the regulatory discretion
that national legislators enjoy when it comes to implementing their own patent
systems. In the end it is up to the individual state to choose the option that
best suits its national socio-economic situation.

The Declaration on Patent Protection supplements the existing research
work of Max Planck Institute for Innovation and Competition. Six years ago
the Institute published a Declaration on a ‘Balanced Interpretation of the
Three-Step Test in Copyright Law',
which deals with limitations and exceptions to copyright protection and has
received worldwide attention. Both Declarations are flanked by ‘Principles
for Intellectual Property Provisions in Bilateral and Regional Agreements’,
in which the risks of unbalanced free trade agreements (FTAs) are pointed out
and recommendations are given with regard to the definition of negotiation
mandates, negotiations as such as well as the interpretation and
implementation of FTAs.

Roll on tomorrow! Let's see the details. Then we can start to discuss them in earnest ...

2 comments:

Anonymous
said...

It's good for someone to be looking independently at the fairness of IP monopolies, particularly in trade agreements. Whilst patent monopolies are required they must inhibit the formation of new tech companies and that must inhibit innovation and competition. I can't help but think that as well as research exemptions we need some sort of small entity exemption from infringement.